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Years after announcing 686 new apartments, little work has been done on District Detroit housing

Posted at 12:39 PM, Jun 09, 2021
and last updated 2021-06-09 20:37:00-04

DETROIT (WXYZ) — Months before the publicly subsidized Little Caesars Arena opened, Chris Ilitch gathered with Detroit Mayor Mike Duggan and members of the press to share some big changes for "District Detroit" —  the 50 blocks around the arena, where Ilitch-associated companies own the vast majority of the land.

RELATED: Ilitches touted 6 housing buildings in The District Detroit in 2017; here's where they stand today

"It is exciting to be here today announcing the next steps for residential development in the District Detroit," Ilitch, the president and CEO of Ilitch Holdings, Inc., said at the May 2017 press conference. "The District Detroit will be one of the most unique and exciting places in the country to live."

The company promised a total of 686 units across six different buildings.

"Detroit’s largest single announcement of residential development in more than 20 years," Ilitch said.

A press release sent out about the project explained that half the buildings should expect construction or renovation to start that year. The rest in 2018.

"It’s the kind of investment in housing we haven’t seen in this city in decades," Duggan said at the conference.

But if you click on the residential leasing brochure on the "District Detroit" website today, all you’ll find is a 404 page. While an entire arena was built in just over two years, four years after this press conference, not a single promised residential project has been completed.

7 Action News went to visit the six promised residential buildings last week: Here is what we saw versus what was promised in 2017.

The Alhambra (100 Temple) – Renovation was expected to start in 2018

The American (408 Temple) – Renovation was expected to start in 2018

The Arena Lofts (120 Henry) – Construction was expected to start in 2017

The Eddystone (110 Sproat) – Renovation was expected to start in 2018

One Eleven West (111 Henry) – Construction was expected to start in 2017

150 Bagley – Renovation was expected to start in 2017

The only residential building where work is currently in progress is the Eddystone. Renovations began in August 2019 after Olympia Development missed its 2018 deadline with the city to start renovations, and the Downtown Development Authority put some pressure on the project. They issued a surety bond saying that if the project isn't completed by 2023, they can take over.

Olympia Development declined an on-camera interview, but Ed Saenz, the director of communications, pointed us to a number of press releases showing what they called "steady, balanced and community-minded development."

This included news of a new tenant — Warner Norcross — coming to a newly constructed office building on Woodward next to the arena, and a February 2020 update on the Eddystone renovations.

"It is not uncommon for the pacing of development projects throughout the country, including in Detroit, to change or alter over time. This is due to a variety of reasons, including community and market needs, demand, tenant interest, the need for additional planning, as well as general economic conditions (including COVID-19)," wrote Saenz.

He noted that the organization is hoping to get started on 150 Bagley — the former United Artists building — in the coming year, once they get a HUD loan processed. As for the other four promised residential projects, he wrote that they "continue review development options."

"ODM’s approach has been to prioritize or accelerate certain developments based on community and market need," Saenz continued, pointing to the recently completed office building on Woodward, work currently being done on the Women's City Club (which will provide business and retail space) and a 2020 announcement about plans for a different residential project on Henry Street.

"We remain," he wrote, "optimistic for our city and communities and will continue with our steady and balanced development throughout The District Detroit."

But not everyone's giving the organization such a quick pass.

"These are billionaire actors who have built arenas before, which are some of the most complex construction projects there are," said Francis Grunow, a Cass Corridor resident who was on the "District Detroit" Neighborhood Advisory Committee, a group that formed in 2014 as part of Olympia Development's arena deal with the city. "They can make things happen when they really put their mind to it."

While the NAC requirement expired in 2019, Grunow is still keeping tabs of the development and promises.

"The Ilitches represent a great opportunity, a great potential, a great vision in some cases, and I want these places to be successful in much the same way they say that they do, and it kills me to see how a place like District Detroit is just such a small shadow of what it’s purported to be," said Grunow, who sees his role as a cheerleader and a watchdog.

"The public has invested so much public money in the form of tax breaks and incentives and land," he said. "We deserve it, as Detroiters to have these things come to pass."

READ THE OLYMPIA DEVELOPMENT MICHIGAN STATEMENT TO WXYZ.COM BELOW

Full statement from The District Detroit and Olympia Development (ODM):

Throughout the pandemic, Olympia Development of Michigan (ODM) continued its commitment to steady, balanced and community-minded development throughout The District Detroit. Notable accomplishments in the past year included:

● The recently completed, state-of-the-art office development at 2715 Woodward, which will be occupied by Warner, Norcross + Judd and Boston Consulting Group.

● The former Eddystone Hotel which will provide our community with new affordable and market-rate housing and street-level retail as part of a historic redevelopment (on schedule for completion in 2021).

● The continued restoration of the historic Women’s City Club which will bring new business tenants and retail to The District Detroit (also on schedule for completion in 2021).

Additionally, pre-development activity continues on other important projects:

● We are continuing to review the historic redevelopment of multiple buildings on Henry Street, which, when approved by the city and state, will bring market-rate and affordable housing to Detroit at levels as low as 30% of the average median income level.

● Progress continues with respect to the historic redevelopment at Residences @150 Bagley, the former United Artists building, which also includes affordable units. Our development partner, Bagley Development Group, has indicated that construction is expected to begin this year after the HUD loan process is completed.

● We continue to review development options for 100 Temple, 408 Temple, as well as for 110 and 120 Henry
These most recent projects build on several years of completed development within The District Detroit, including:

● Little Caesars Arena (the second-busiest arena in the country, behind only Madison Square Garden, which, along with Comerica Park and the Fox Theatre, brings about 14 million people into the arena district each year, which benefits many local businesses).

● Chevrolet Plaza (public space).

● Detroit headquarters for Google.

● The Little Caesars world headquarters (Detroit’s first newly constructed corporate headquarters building in more than a decade and only the seventh since 1950).

● The Mike Ilitch School of Business (made possible, in part, through a $40 million gift to Wayne State University from Mr. and Mrs. Ilitch).

● The Columbia Street development (a pedestrian-only street with multiple retail and restaurants, including Frita Batido’s).

● Additional shops and restaurants like Starbucks, and Tin Roof, a bar and restaurant offering live entertainment.
ODM worked closely with city and state officials to create a plan that would enable the arena while providing a significant return on investment for the City and residents.

It is important to note that at the time of the arena groundbreaking in 2013, the city was emerging from bankruptcy and development and investment were near a standstill.

ODM’s willingness to invest $450 million (later increasing to more than $800 million) into the city at such a time was a massive show of capital support for the city. This was recognized as critically important by all parties, including the Financial Manager, DDA and the State of Michigan.

While funding of the arena did include public incentives, all of the obligations (as verified by the DDA) associated with the funding for the DDA-owned arena have been met. Indeed, the required ancillary development obligations were met years ahead of schedule.

The jobs and economic impact as a result of all of the above developments have been significant:

To date, over 20,000 men and women have been hired for highly paid skilled trades and construction, construction related and permanent jobs for these developments.

ODM contributed approximately $6 million in fees toward workforce development funds that would provide skilled trades training for Detroiters.

Forty-three Detroit-based companies received 60 percent of arena contract awards worth more than $530 million.

New businesses have, and continue to, find a home in the arena district, including Google, the Detroit Pistons, Boston Consulting Group, Warner Norcross and Judd, and retail like Tin Roof, Starbucks, The M Den and more.

Because of the new construction in The District Detroit, the tax base in the Detroit Downtown Development Authority’s Catalyst Development district increased an estimated 456 percent from 2013 to 2018.

It is not uncommon for the pacing of development projects throughout the country, including in Detroit, to change or alter over time. This is due to a variety of reasons, including community and market needs, demand, tenant interest, the need for additional planning, as well as general economic conditions (including COVID-19).

ODM’s approach has been to prioritize or accelerate certain developments based on community and market need, including, for example, Women’s City Club, 2715 Woodward and pre-development activities at Henry Street (all referenced above).

We remain optimistic for our city and communities and will continue with our steady and balanced development throughout The District Detroit.